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Qualcomm’s patent licensing fees were calculated based on the selling price of the phones into which its chips were built, not on the selling price of the Qualcomm chips which went into the phone.
Arm currently charges a licence fee plus a royalty of around 1-2% of the selling price of the chip into which its IP is integrated.
Now Arm is looking at charging the phone maker a royalty based on the sales price of the phone into which the chip goes.
Arm is reported to be telling chip makers they can’t sell chips with Arm IP in to phone makers who don’t agree to pay the royalty.
It is a move which only a company with a monopoly could make.
The reason appears to be because Arm is about to be IPO’d, because Softbank is massively in debt and needs to maximise the return from the IPO and because the change in Arm’s charging structure could make it substantially more profitable.
Phone makers have no immediate alternative but will look hard to find one. The long-term future of Arm is imperilled but Softbank’s interest in Arm extends no further than the end of the year.
The msin question I have is what happens to those manufacturers which already have a license for a specific core.
If a chip has already been designed, it seems unacceptable to change the license agreement, if at all possible.
Since you probably pay something upfront for a core, even changing the license for an already purchased core seems out of line. What they do with new cores is another thing.
What are they going to do with distributors?
Do you have t9 sign an ARM license to buy from DigiKey?
Looks like bean counters greed strikes again
It’s desperation IMHO dick, Softbank really needs to maximise the return from this IPO.
Total insanity, and will totally destroy the ARM licensing model, not just for the mobile phone market, their main cash cow, but for all ARM licensees in general who can no longer trust ARM not to screw them in the future. Hopefully, prospective investors in the IPO will recognize this and stay clear. It may take a couple of years for RISC V to catch up, but catch up and overtake it will now as everyone with an interest will pour resources into RISC V development rather than being screwed by ARM. Maybe alternatives to Android as an OS as well, driven by Chinese interests. Let’s see, but once again, we are living in “interesting times” where the established status quo can change rapidly.
Absolutely Fred it would be ironic if this spiteful move to maximise the IPO proceeds resulted in a lower valuation. As you say trust will be gone and, without trust, Arm is doomed
RISC-V would have to get around a whole load of ARM patents, which in themselves were designed to get around Intel and AMD patents. Despite all the hype, the numerous RISC-V chips currently on the market are really just expensive toys looking for a market. The only one that isn’t overpriced and underpowered is the ESP32-C3, but its sister chip the ESP32-S3 with a dual core Xtensa processor and lots more peripherals because it’s a smaller core outperforms it. Where RISC-V is winning business is taking over from 8051s as the supporting MCU of choice inside many SoCs. NVidia use them in lots of their ARM devices performing mundane tasks an ARM core would be wasted on.
Lattice Semiconductor integrates Risc V in their FPGA chips.
The new ARM pricing model loses the server market for ARM. Very clever these Chinese…
This is a great opportunity for the RISC-V open-source microprocessor.
The only option that looks open to me (for my applications) at the moment is the GigaDevice GD32VF103 series. I can’t see any other RISC-V microcontroller on the market. We had a look at replacing ST with GigaDevice during the shortage; this was ARM cores not RISC-V cores, though.
I’d be interested to hear of any other RISC-V based microcontrollers that are available.
Andes have some great technology going into chips right now. Their licensee page is quite interesting….
That pointed me to Renesas. Looks like Renesas have a couple of fairly specific RISC-V microcontrollers available.
Yes DB if Softbank wasn’t getting shot of it, I doubt if they’d take such risks with Arm’s business model
Fully agree with your last paragraph. Makes me wonder if the Nvidia deal would have been better for the customers and ARMs long term future …
A very good point DontAgree.